As a Miami real estate professional, I am asked a lot of the same questions on various topics. Below, you will find a list of answers to the most commonly asked questions. I am sure you will find these answers quite useful, especially when you are buying or selling a Miami home or Miami condo.
Commissions:
- Miami real estate buyers do NOT pay commissions. The seller pays the commissions in virtually all transactions. The same applies to tenants where the landlord pays the commissions.
Locations:
- Miami and Miami Beach are 2 different cities in 2 different locations. Miami is on the mainland of Florida, and Miami Beach is an island 2 miles east of Miami. There are no beaches in Miami. The beaches are located in Miami Beach.
- South Beach is not a city. Other than a place that LeBron is “going to bring his talents to,” South Beach is a nickname of a section of Miami Beach between 5th Street and 23rd Street.
Costs:
- A buyer’s closing costs are going to be approximately 1%-3% of the purchase price. This number will vary depending on whether or not you are paying cash or financing your purchase.
- A property inspection is not required but is highly recommended. The cost is approximately $200-$800 (depending on property size) for an inspection, which is a small price to pay for peace of mind.
- The seller pays the doc stamps for the recording of the deed, not the buyer.
Landlord/Tenant Laws:
- Unlike some states, the laws governing the relationship between a Landlord and a Tenant in Florida are statutory. Please see the Florida Residential Landlord and Tenant Act which is Title VI, Chapter 83, Part II, § 83.40 – § 83.682.
Cash vs. Financing:
- You will NOT be able to obtain financing for some Miami condos, regardless of your credit score or income, based on Fannie Mae guidelines. Contact us for a more in-depth explanation.
- You cannot always depend on a pre-approval letter when financing a condo in Miami.
- In Miami, cash is not always king. Because of the high-level of cash-buyers in the Miami real estate market, a cash offer does not necessarily give a buyer more leverage in negotiating sales price.
Taxes:
- There is no absolute way to calculate property taxes prior to closing, regardless of what the current owner is paying; however, in Miami-Dade County, the rule of thumb for estimating your property taxes is approximately 1.75% of the purchase price.
Living Area – Square Footage – Maintenance Fees:
- Monthly maintenance fees on a condo are calculated based on the square footage of the livable area or area “under A/C,” meaning under air conditioning. Never use the terrace space to calculate square footage. Also, the maintenance fees do not change as you move to a higher floor. It is purely based on a set price per square foot. For instance, if you have a condo on the 8th floor and a condo on the 48th floor of the same building, the maintenance fee per square foot will be the exact same on both condos.
- When looking at asking price per square foot or comparable sales price per square foot, always make sure to use under A/C living area square footage.
- Use caution when purchasing a 2-story loft-style condo as developers usually count the “air space” above the living room in their floorplan when quoting square footage of living area.
Parking:
- Nearly all Miami condos that include a parking space include assigned parking, not deeded parking, meaning the space is assigned to you and controlled by the condominium association. This means that you cannot just purchase or sell parking spaces in a condo building. Further, assigned parking spaces are owned by the respective condo association and assigned to individual owners, which technically means the condo association could change an owner’s parking space in a building to a different space, even though this rarely happens. So, what could happen and why should you be knowledgeable about this…when you are selling or buying a condo, the condo rider of a purchase agreement asks for a specific parking space number(s) for the respective condo being sold. Most real estate agents input a specific parking space number, but this should not be done, and here is why. If a specific parking space number is entered in the condo rider to a purchase contract for someone buying a condo, but the condo association, for whatever reason, changes the parking space number between the execution of the contract and the closing of the condo, problems could arise. For instance, “John” is buying a condo from “Susie” and John’s agent inputs in the condo rider to the purchase agreement that John is purchasing the condo with parking space #222 because that was the space assigned to Susie. But, before John closes on the unit, the condo association changes the parking space to space #1022. This means that when John closes on the property, he finds out after-the-fact that his parking space is now on the 10th floor instead of the 2nd floor. This could have been a deal breaker for John had he been informed this prior to closing because parking to a lot of condo owners in Miami is very important.
- Many of the condos in Miami and Miami Beach have private valet companies that manage their valet services. For these condos, owners and tenants generally may pay a flat monthly rate for a valet space for their unit, separate from the in-an-out fee paid by guests. This must be negotiated with the valet company who manages the respective building directly.
Pets:
- Always check a condo association’s rules regarding the pet policy before you make an offer. A building that allows pets for owners does not necessarily allow pets for tenants. Whether you are an owner or a tenant, you should call the condo association for the exact pet policy. Here is a list of condo association phone numbers.
Pre-Construction Condos:
- Many units purchased pre-construction from a developer, are delivered “decorator-ready.” Decorator-ready generally means that a condo is delivered with a kitchen and bathrooms built out but no flooring, trim, closets or window treatments. If you purchase a decorator-ready condo, be prepared to hire a contractor to install flooring, trim, closets, window treatments, lighting and paint which may take 60-90 days after closing.
- Many units purchased pre-construction from a developer, are delivered “built-out.” Built-out generally means that a condo is delivered with flooring, trim and white walls, but you still must hire a contractor to install window treatments and build custom closets after closing. Further, if you buy truly pre-construction, many developers will give you select options for flooring, kitchen cabinetry and kitchen countertops with optional upgrades that will be delivered finished for you at closing.
